Many Singaporeans rely on Social security systems like the Central Provident Fund to help fund their retirement.
Because Singaporeans are living longer, many are concerned if they can save enough for retirement by age 62.
According to an article by Today Online, Manpower Minister Josephine Teo said on 5 March 2019, that the retirement age and re-employment age are set to be raised. The actual date and by how many years, has yet to announced.
WHY THE CHANGE?
A workgroup comprising representatives from the Government, labour unions and the private sector, has highlighted two reasons for raising the retirement and re-employment ages.
First, the retirement age remains relevant and should go up beyond 62, because Singaporeans are enjoying more years of good health and remain productive at work. A higher retirement age will motivate both workers and employers to invest in upskilling and redesigning the jobs of older workers.
Second, although most workers who are eligible get re-employed in the same job at the same pay, the flexibility to reset jobs and terms, help employers cope with business uncertainties. Employers are more willing to employ older workers because of it. More than 90 percent of the workers who are eligible for re-employment and wish to continue working, are offered re-employment every year.
IT’S NOT ABOUT HOW MUCH YOU EARN, IT’S ABOUT HOW MUCH YOU SAVE
Savings and investments are important in today’s fast-paced economy.
The concept of having a “iron rice bowl” job is less of a certainty today compared to 20 years ago, as more permanent jobs are getting replaced by short-term contract and freelance jobs. Therefore, it is crucial to save up as much as possible during your working years.
WHAT ELSE CAN YOU DO TO ENSURE YOU HAVE ENOUGH FOR RETIREMENT?
According to a report by Channel News Asia, Singaporeans have overtaken the Japanese in terms of having longest life expectancy in the world.
The expected lifespan of Singaporeans is 84.8 years. However, the number of years spent in poor health has also gone up from 9 years to 10.6 years.
Healthcare needs are closely linked with adequacy of one’s retirement. Anyone can be struck by critical illness, which can exhaust one’s life savings if not adequately insured. This is why it is crucial to buy insurance when you are in good health.
Speak to your trusted FLA Organization financial planner today, if you need advice on insurance coverage for you and your family.
